Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA), Sanofi-Aventis SA (NYSE: SNY; Euronext: SAN), and China's Sinopharm Group Co. Ltd. (HKSE: 1099; Pink Sheets: SHTDF) are three frontrunners to buy German generic-drug maker Ratiopharm GmbH as the deadline for second-round bids ends this week, according to "Bloomberg". The report is based on three sources close to the issue, who declined to be identified because the talks are private.
Teva said in response that it does not respond to rumors.
"Bloomberg" quotes the sources as saying that four to six potential buyers from about a dozen initial bidders will be invited to continue negotiations with Ratiopharm’s owners. Commerzbank AG and Royal Bank of Scotland Group plc, who are managing the sale, aren’t accepting offers lower than €2 billion ($3 billion).
Teva has previously said that the price tag of €2.5-3 billion for Ratiopharm was "expensive", but Teva may now be willing to pay it in order to expand the company's presence in Europe, especially in Germany, where its presence is thin.
"Bloomberg" added that Mylan Inc. (NYSE: MYL), Watson Pharmaceuticals Inc. (NYSE: WPI) and Pfizer Inc. (NYSE: PFE; LSE: PFZ) are interested in part of Ratiopharm.
Ratiopharm had €1.7 billion in sales in 2008. The company is considered an inefficient company, and it will reportedly have to undertake thorough streamlining measures after the sale, regardless of the buyer. The measures will probably include extensive layoffs, which are not easy under German labor laws, which mandate severance payments for at least one year.
Teva's share closed at $54.01 on Nasdaq on Friday, giving a market cap of $47.6 billion. The share rose 0.3% by midday on the TASE today to NIS 205.
Published by Globes [online], Israel business news - www.globes-online.com - on December 6, 2009
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